AGI-Shorewood Invests in Technologies for Growth
Excess capacity in the packaging market is driving margin compression, but the flip side of any challenge is opportunity. And ASG (AGI-Shorewood Group) is quietly deploying the products—bespoke color branding, large-format digital presses, plastics, a new stand-alone creative agency—and the strategy to leverage the company's positive sales momentum.
"ASG has an aggressive, five-year capital plan to improve our value-added offerings and our position in the marketplace," ASG CEO Americas Mark Caines says. "We are looking into a combination of acquisitions to increase our critical mass and support the growing CPG market."
ASG is a relative newcomer with an impressive pedigree. When packaging specialists AGI and Shorewood Packaging merged in January 2012, the owners, Atlas Holdings and International Paper, envisioned a combined portfolio of best-of-breed resources and capabilities to offer key customers on four continents.
"The merger allowed the organization to diversify into new markets with a stronger, more nimble organization, operating close to its customers and focusing on their long-term satisfaction," explains Caines. "ASG's operating philosophy is to establish a value proposition that allows us to be an innovative supplier of premier packaging products for our customers."
Caines describes those customers as blue-chip brands in the home entertainment, beauty, fragrance, personal care, cosmetics, healthcare, pharmaceuticals, consumer electronics, sporting goods, and confectionery markets that produce folding cartons, set-up boxes, and custom special packaging with innovative decorative effects.
Color, color, and more color
"As costs increase in China, we're seeing more companies looking to repatriate production back to the States," Caines notes. "This means an increase in opportunities for U.S., Canada, and Mexico to start producing work that has been overseas for the last decade, utilizing our proprietary methods of color management."
In June, the company announced that its Hendersonville, North Carolina facility was the first U.S. packaging converting plant to achieve Pantone Certification.
ASG also offers a proprietary extended gamut printing technology called the Q System, which allows the company to extend the gamut of PMS printing.
"It's targeted for work in markets with a high number of SKUs that use similar die lines and stocks," Caines explains. "The primary use of our Q System today is for the OTC pharma and personal care markets."
Caines says the company's extended gamut printing capabilities provide a competitive advantage that is not lost on ASG's customer base.
By using the Q System, ASG sees reductions in the number of makereadies, reducing costs. Custom colors that can be broken down into process colors can be developed to meet a customer's brand imperatives, reducing the amount of spot colors that, in turn, produce additional cost savings.
"Secondly, ASG can develop custom separations to produce more vibrant colors," Caines contends. "Essentially, we can generate a gamut of spot colors without having to specifically run spot PMS colors, as we utilize a seven-color separation process. We're able to print outside of the CMYK spectrum, pushing the boundaries to produce exceptional, saturated colors that help our customers' packages pop on shelves."
ASG also maintains an extensive library of Q colors dedicated to its customers and calibrated to its presses.
"Developing custom color formulas, using a variety of proprietary look-up tables, helps differentiate ASG's system from other 'out-of-the-box' systems," Caines says. "Additionally, the Q System is perfected to match ASG presses. ASG's presses are G7-certified which means we can print to G7 Neutral Print Density Curves, ensuring gray balance and neutral tonality. This gives our customer the closest color match from proof to press."
"ASG's customers love the high level of flexibility and cost options," he points out. "Leading consumer brands are able to achieve unique, vibrant colors utilizing the Q System without having to spend a fortune on additional spot colors." Extended gamut printing is performed in ASG's Indianapolis facility.
Large-format digital
Caines notes that ASG has partnered with HP to become a beta site for a new large-format digital press geared towards the folding carton industry. In 2014, the company will acquire an HP Indigo 30000 large-format digital press to complement its soon-to-be-installed HP Indigo 5500 digital press. Both presses, which expand ASG's just-in-time capabilities, will be installed at the company's Toronto facility.
With the new digital presses, ASG will offer its customers advanced proofing, creative, and product development services that include package design, development, prototyping, and market sampling.
Dynamic design and prepress
ASG has also unveiled a full-service creative design and prepress division that operates independently from the company's print division.
"Recently rebranded as Spark!, our creative services business assists both our print and non-print customers," Caines says. "Design and structural development, key art, localization, project management, and sophisticated production art are offered globally to Fortune 500 companies."
"We see Spark! as a differentiator," Caines says, "a way for our customers to plug into our knowledgeable network of creative geniuses—and for them to cut a few steps from their workflow by consolidating assignments."
Entertainment chops
The roots of the worldwide package printing provider run deep. A supplier of innovative packaging solutions since the 1960s, the company continues to expand and evolve.
AGI was launched in 1968 as Album Graphics Inc., a company specializing in artwork design and printing of vinyl record sleeves. Through various acquisitions, including those of Sonic Plates, Pinepoint, and DuBois, the company maintained a leadership position in the home entertainment packaging market and more recently in the FMCG packaging market.
Shorewood Packaging was founded in 1966, and soon developed a joint venture with CBS Records to package record albums in the U.S. and Canada. The company eventually acquired Somerville Packaging, which became the catalyst for growth into the consumer segment. In 1998, Shorewood Packaging acquired Queens Group, which added to the company's portfolio in both music and consumer packaged goods markets.
In 2000, Shorewood Packaging was acquired by International Paper and the company was part of the paper giant until its acquisition by Atlas Holdings LLC.
"ASG utilizes a variety of equipment from all major manufacturers," Caines says. "Additionally, our capital plans will be based around manufacturers that can provide the highest level of innovation and lowest cost of production to benefit our customers."
ASG relies on four offset presses at the Indianapolis facility: a pair of 51˝ KBA presses (one 7-color and one 8-color) and two 8-color, 40˝ Heidelberg XL 105 presses. All four presses have anilox tower coaters. Three of the presses have UV drying systems.
In the U.S., ASG has manufacturing facilities in Melrose Park, Ill., Indianapolis, Elizabethtown, Ky., Louisville, Ky., Pittsfield, Mass., and Hendersonville, N.C. It has three other North American manufacturing facilities in Canada and Mexico.
The Indianapolis facility is built on a culture of Lean and Six Sigma principles, and is FSC, SFI, and PEFC Chain of Custody certified. It boasts a digital workflow including electronic data transfer, electronic and analog prepress and computer-to-plate technology, and uses cGMP and ISO 9000 guidelines. The plant also offers complete finishing capabilities, including diemaking, diecutting, foil stamping, embossing, windowing, straight-line gluing, traying, bar code scanning, glue detection systems, security tag, and label applicators. pP
- Companies:
- Heidelberg
- International Paper